Question
Managers have some discretion in making key accounting-related decisions, and due to the COVID-19 pandemic; most companies will have lower earnings in 2020 than in
Managers have some discretion in making key accounting-related decisions, and due to the COVID-19 pandemic; most companies will have lower earnings in 2020 than in 2019. Assume that for 2020, a company wants to do what it can so that its financial statements look as 'good' to investors as they did in 2019. Discuss the judgmental decisions the company might make with respect to:
A) Accounting for accounts receivable/allowance for doubtful accounts
B)Accounting for acquisitions of property, plant and equipment
C) Accounting for depreciation
D) Repurchasing shares of stock (aka purchasing treasury stock)
E) What impact would each of these decisions have?
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